|Approval Date||29 Nov 2021|
|Signature Date||03 Mar 2022|
|Planned Completion Date||31 Dec 2024|
|Sovereign / Non-Sovereign||Sovereign|
|DAC Sector Code||15124|
The project is critical to support FGS to ensure more efficient PFM practice that will be needed to handle the increased external support and complexity of development financing that Somalia may receive after reaching the HIPC completion point. Somalia has made good progress in the area of financial transparency and accountability; but further action is still needed. A basic fiscal framework - supported by an annual budget process, regular fiscal reporting and improved cash management capacity - has been established by the FGS. The overall Ibrahim Index of African Governance (IIAG) score improved from 8.0 out of 100 in 2013 to 19.2 in 2019. However, the Bank’s CFRA conducted in 2020 has identified five PFM challenges and fiduciary risks: (i) instituting PFM fundamentals for budget credibility; (ii) effective budget execution and financial accountability; (iii) improving policy formulation, planning and budget preparation; (iv) institutional structures; and (v) sound public debt management and transparency. In addition, essential central institutions such as the Ministry of Finance (MoF) and other ministries suffer from significant capacity deficiencies due to inadequate physical infrastructure, and financial and human capital resources. Addressing these identified areas require significant technical and financial assistance, given the current tight fiscal space, with extremely limited capacity to raise revenue. Therefore, this operation is in line with addressing the challenges identified in the CFRA.
The overall goal of the project is to improve Somalia’s PFM and debt management capacity for greater economic stability and resilience. The project is structured around three main operational objectives: (i) promote effectiveness and efficiency in the internal and external audit oversight functions to ensure improved budget planning and execution oversight in the public sector; (ii) strengthen institutional capacity for transparent and accountable results-based PFM; and (iii) strengthen debt management framework and greater transparency to achieve enhanced transparent and sustainable debt management.
The direct beneficiaries of the project will be the Departments in the Ministry of Finance (Internal Audit, and Debt Management Unit); Office of the Auditor General, and MDAs officials involved in PFM activities. The project will ultimately indirectly benefit all citizens of Somalia through building the weak human and institutional capacity in public debt management and promoting good economic governance. The ultimate result is increased resources available to finance the provision of public goods and services, investments in development programs, enabling recovery and relieving poverty.
Fragile States Facility
GOVERNMENT OF SOMALIA MINISTRY OF FINANCE
|Last Update||28 Nov 2022|
|Name||ALAMIR AHMED Mosllem Ahmed|